Phase-out of Pa. state liquor stores under debate

Thursday

Mar 21, 2013 at 6:28 PMMar 21, 2013 at 6:29 PM

A plan to phase out Pennsylvania's 600 state-operated liquor stores and raise revenue by selling licenses to private businesses was approaching an important hurdle today as Republicans in the state House sought to move the bill to the Senate.

MARK SCOLFOROAssociated Press

HARRISBURG — A plan to phase out Pennsylvania's 600 state-operated liquor stores and raise revenue by selling licenses to private businesses was approaching an important hurdle today as Republicans in the state House sought to move the bill to the Senate.

During hours of afternoon debate, the mostly Democratic opposition warned that the privatization bill would put thousands of state store employees out of work, cost more and generate less than backers said, and make alcohol more widely available, bringing with it a range of social problems.

Republicans in the majority appeared to be holding their ranks together, as only two GOP members spoke against the proposal, and an effort to send it back to committee lost by a 108-87 vote.

"This bill will end up in the Senate, come back to us, and all of us, on both sides of the aisle, will be involved in trying to craft a product that works for everybody in Pennsylvania," said Liquor Control Committee chairman John Taylor, R-Philadelphia.

The 194-page bill would give existing beer distributors the priority in purchasing 1,200 wine and spirits licenses. It also would allow groceries to sell wine, and enshrine their current ability — won through court rulings — to sell takeout beer. Eventually, another 600 licenses could be added to the mix.

Republican Gov. Tom Corbett, who supports privatization, has said the fees from the licenses — at least hundreds of millions, perhaps as much as $1.1 billion — should go to improving public education.

The bill does not dictate how the money is spent, only that it should be deposited in a special account. Legislative officials said the spending would be determined in separate, future legislation.

"I'm sure, just as I'm standing here today before you on this historical vote, that money generated by the sale of these licenses will be put into public education," said Appropriations Committee chairman Bill Adolph, R-Delaware.

Rep. Jake Wheatley, D-Allegheny, said he was concerned that some communities would be flooded with new retail booze outlets.

"When this thing is fully instituted, and we see an increase of alcoholism, or we see an increase of destruction that happens in our neighborhoods because of accessibility to a drug, then we have a responsibility to pay for that," Wheatley said.

Supporters said the changes would increase sales in part by recapturing sales from Pennsylvanians who currently purchase wine and liquor from other states, particularly New Jersey.

House passage would move the debate to the Senate, where Majority Leader Dominic Pileggi, R-Delaware, said the goal should be improving selection, price and convenience.

"I don't think anyone expects the Senate to just take up the House bill and move it to the governor's desk as-is," Pileggi told reporters in a Thursday conference call conducted shortly before the House debate began.

"I think the focus should be on what the system would deliver to the citizens of Pennsylvania," and particularly convenience, selection and competitive pricing, Pileggi said. "I'm not as caught up in the ideological part of the legislative effort as the benefits to citizens."

Under the bill, the state would continue to operate liquor stores in otherwise underserved markets until the number of stores dips below 100 stores. It provides for special job placement benefits for displaced Liquor Control Board employees. State taxes, including the 18 percent Johnstown Flood Tax, would continue to be levied, and supporters noted that the private retail operators would also be contributing payroll and business taxes.